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World Trade Organization

Unfolding the One World Story

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History
Old wine in a new bottle

ØThe idea of WTO was conceptualized in Bretton Woods


Conference in 1944, along with World Bank and IMF.

ØInternational Trade Organization (ITO) Charter was


rectified to form an interim arrangement in the form of
GATT (1948).

ØFinally born, on 1st August, 1994 and came into act


from 1st January, 1995.

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The Uruguay Round
ØUruguay Round (UR) was the 8thround of multi-lateral trade
negotiations held in Sept ’86.

ØDue to the conflicting issues UR could not be concluded in Dec ‘90 as


scheduled.

ØArthur Dunkel, the then Director General of GATT presented a draft act,
popularly known as Dunkel Draft.

ØDunkel Draft was replaced by an enlarged and modified final text was
approved by 125 Governments on 15th April 1994.

ØThis Draft led to the formation of WTO. An organization that was


conceptualized 50 years back.

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Functions of WTO
The WTO has 5 specific functions.

c) The WTO shall facilitate the implementation, administration and


operation of multi-lateral and pluri-lateral trade agreements.

e) The WTO shall administer the Trade Review Mechanism.

g) The WTO shall provide the forum for negotiation among the
members concerning the multi-lateral trades.

i) The WTO shall administer the understanding on rules and


procedures governing the settlement of disputes.

k) With a view to achieve greater coherence in Global Economic Policy


making the WTO shall co-operate with IMF, IBRD and its affiliated
agencies.

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GATT to WTO – A half a century
Journey
WTO GATT
ØWTO and its agreement are ØGATT was Ad-Hoc and
permanent provisional

ØWTO has members ØGATT had contracting parties.

ØWTO is more powerful than ØGATT allowed domestic


GATT legislative purview.

ØDispute settlement ØGATT was less powerful, dispute


mechanism faster and efficient. settlement slow and inefficient.

ØVery difficult to block its

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WTO and Developing Countries

1 WTO provides a window for gradual roll-out of TRIPS


and IPR regulations.

3 Provision for regional trade blocks.

5 The principles of Non-discrimination, transparency,


increased certainty, trade facilitation and protection
from monopolistic competition.

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WTO and India
1 India’s trade gain.

3 Competitive advantage due to WTO.

5 Potential of becoming a knowledge hub due to


CBD (Connection on Biological Diversity) and
better IPR protection.

7 FDI and MNC Exposure.

9 India getting a platform to showcase its talent


“Seattle is Bangalored…”
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WTO and Agriculture

ØBlue Box, Green Box and Amber Box


Subsidy

ØDumping and Tariff Barrier.

ØQuarantine Barriers.

ØMango Vs. Harley Davidson.

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Ministerial Round and Present
Deadlock
1 Ministerial Conference is the highest body of WTO.

3 Due to conflict of interests between developed and


emerging nations, especially in-terms of agricultural
subsidies last few ministerial conferences have
failed miserably.

5 BRIC and MERCOSUR trade blocks are building


another axis of power apart from Euro and US

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Evaluation of WTO
Benefits of WTO:
3 WTO has made significant achievements in reducing the Tariff
and Non-Tariff Barrier.

5 The liberalization of investments had been fostering economic


growth of a number of countries.

7 WTO provides a forum for multi-lateral discussions of economic


relations between nations.

9 It has a system to settle trade disputes between nations.

11 Malta to Morocco, Stockholm to Shanghai World on one platform


.

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Evaluation of WTO
Criticism:
3 Negotiations and Decision making in WTO dominated by Developed
Countries.

5 Most Developing Countries do not have the Financial and Knowledge


resources to effectively participate in the WTO discussions and
negotiations.

6 Due to the dependence of Developing Countries on the Developed


ones, the Developed countries are able to resort to arm-twisting
techniques.

8 The WTO has not been successful to impose the organizational


disciplines on the Developed Nations.

10 Sub-Saharan, Third World and OECD countries are becoming new


Colonies- Thanks to WTO.
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DOHA round
ØIt is the current round of negotiations started in November
2001.

ØAn ambitious effort to make globalisation more inclusive and


help the world's poor.

ØThe Ministerial attracted a lot of attention, due to conflicts


between the developing and developed countries.

ØThe multilateral trading system embodied in the World Trade


Organization has contributed significantly to economic growth,
development and employment throughout the past fifty years.
ØThe TRIPS Agreement does not and should not prevent
Members from taking measures to protect public health.
Members can set aside the patent laws if they have to face
epidemics

ØThe talks have been highly contentious and agreement has


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Cancun to Singapore

Go Back
Go
Back…!!!
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